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Revenues

Total revenues of $244,102 for the second quarter of 2016 increased by $109,164 or 81% and by $110,001 or 40% to $386,751 year to date compared to the same periods in 2015, primarily as a result of the acquisition of Service Experts by Enercare, through an indirect wholly-owned subsidiary of Enercare Solutions Inc. ("Enercare Solutions"), on May 11, 2016 (the "SE Transaction").

Enercare Home Services revenues, excluding investment income, increased during the quarter by $1,616 to $107,989 and by $4,032 to $214,418 year to date, compared to the same periods in 2015, primarily as a result of a rental rate increase implemented in January 2016, changes in asset mix and growth in rental HVAC units. Contracted revenue in Enercare Home Services represents revenue generated by the rentals portfolio and protection plan contracts, while sales and other services revenue mainly pertains to one-time sales and installations of residential furnaces, boilers and air conditioners as well as plumbing, duct cleaning and other services. The onset of warmer spring weather during the second quarter was delayed, compared to historical norms, as measured by heating degree days, which were 11% higher than the 26 year average and the highest experienced in the past 12 years. The cooler weather resulted in lower demand for air conditioning sales and rentals in the early part of the quarter. Consequently, Enercare had fewer HVAC sales opportunities, but nonetheless increased rentals over the comparable period in 2015.

Our strategy to emphasize HVAC rentals over outright sales resulted in significant increases in recurring revenue at the expense of sales and other services revenue.

Service Experts revenues, excluding investment income, of $102,209 since the May 11, 2016 acquisition date, were stronger than anticipated driven primarily by warm June temperatures across the United States which resulted in higher HVAC sales from the strong demand for air conditioning sales. Although unfavorably cooler weather conditions across the United States in May impacted HVAC sales during the month, the significantly warmer temperatures in June led to higher HVAC sales in the month resulting in strong overall sales during the post-acquisition period from the high demand for air conditioning sales. May temperatures across the United States were the thirteenth coldest May in the past 25 years while June temperatures were the second warmest June in 25 years. Service Experts sales in Eastern Canada were also positively impacted by the same weather trends experienced by the Enercare Home Services segment while strong HVAC sales in Western Canada during the month of June were also partly the result of warmer weather conditions in this region which saw the warmest temperatures in 25 years. Service Experts revenues during the second quarter of 2016 were lower by $7,836 as a result of the reduction of deferred revenues resulting from the SE Transaction.

Sub-metering revenues, excluding investment income, in the second quarter of 2016, were $33,549, an increase of $5,033 or 18% with year to date revenues increasing $3,431 or 5% over the same periods in 2015 primarily as a result of higher billable units and revenues generated from the acquisition of Triacta Power Technologies Inc. ("Triacta"). Sub-metering revenue includes total pass through energy charges of $24,811 in the second quarter, and $52,558 year to date in 2016, increases of $3,376 or 16% and $150 or flat, over the same periods in 2015. The acquisition of Triacta in the third quarter of 2015 resulted in $1,079 additional revenues in the quarter to date June 30, 2016 and $1,966 of additional revenues in the year to date June 30, 2016.

Investment income was $355 in the second quarter of 2016 and $455 year to date, an increase of $306 and $329, respectively, when compared to the same periods in 2015. The change in investment income was primarily attributable to non-recurring interest earned from Enercare's recent bought deal offering of subscription receipts (the "SE Subscription Receipts"). The SE Subscription Receipts proceeds received in connection with the SE Transaction combined with interest income from the registered pension plan, which was in an asset balance instead of a net obligation during a portion of the second quarter of 2016.

Cost of Goods Sold

Total cost of goods sold for the second quarter of 2016 was $107,772 and $157,432 year to date, an increase of $65,721 or 156%, and $62,633 or 66%, respectively, compared to the same periods in 2015 primarily as a result of the SE Transaction.

Enercare Home Services cost of goods sold increased by $1,284 in the second quarter of 2016, and $1,117 year to date, compared to the same periods in 2015, primarily from approximately $1,300 of non-recurring supplier reimbursements and other items recorded in the second quarter of 2015. Maintenance and servicing costs in Enercare Home Services primarily consist of protection plan expenses and servicing costs related to the rental portfolio, while sales and other services expenses mainly pertain to one-time sales and installations of residential furnaces, boilers, air conditioners and small commercial products as well as plumbing, duct cleaning and other cleaning services.

Service Experts cost of goods sold amounted to $60,665 since the May 11, 2016 acquisition date. Service Experts cost of goods sold during the second quarter of 2016 were lowered by $6,313 as a result of the release of deferred service obligation provisions resulting from the SE Transaction.

Sub-metering cost of goods sold of $25,390 in the second quarter and $53,501 year to date in 2016, increased by $3,772 or 17% and $851 or 2%, as a result of an increase in pass through energy charges over the same periods in 2015. Sales and other services expenses for sub-metering relate to the sale and installation of water conservation products in apartments and condominiums.

Selling, General & Administrative Expenses

Total selling, general and administrative expenses ("SG&A") expenses were $66,861 in the second quarter of 2016 and $105,999 year to date, increases of $32,837 and $36,448, respectively, compared to the same period in 2015.

Enercare Home Services expenses of $23,516 in the second quarter and $49,408 year to date, decreased by $2,451 and $3,067 respectively, compared to the same periods in 2015. The $2,451 decrease in the second quarter was primarily from lower professional fees of $3,100 and selling expenses of $1,300, partly offset by $1,700 of higher billing and servicing costs. During the second quarter of 2015, there were approximately $500 of one-time items resulting in improvements to SG&A expenses which did not recur in the second quarter of 2016. The $3,067 year to date decrease was primarily as a result of approximately $1,400 in lower selling expenses, $1,000 of billing and servicing costs, $800 of professional fees, $500 of office expenses and $300 of bad debts and claims expenses, partly offset by $1,000 of higher wages and benefits, partly driven by $300 of higher stock based compensation costs resulting from an increase in the price of Enercare common shares.

Enercare Home Services SG&A expenses in the second quarter of 2016 included $695 and $2,154 year to date of integration and business transformation costs related to the acquisition of the OHCS business of DE by Enercare on October 20, 2014 (the "DE Acquisition"), primarily from marketing spend related to continued rebranding and information technology integration activities to optimize the information technology platforms. During the second quarter and year to date 2015, Enercare Home Services SG&A expenses included $1,777 and $2,389, respectively, of integration costs associated with the DE Acquisition, primarily from marketing spend related to rebranding activities.

Service Experts SG&A expenses in the second quarter of 2016 amounted to $31,420 since the May 11, 2016 acquisition date. Included in these costs were $6,693 of acquisition related expenditures associated with the SE Transaction, primarily related to professional fees and integration costs. These costs included $2,834 of pre-acquisition expenditures incurred by Enercare Home Services.

Sub-metering SG&A expenses in the second quarter of 2016 were $4,966, an increase of $1,088 over the same period in 2015, primarily from higher wages and benefits of $1,100. Year to date, sub-metering SG&A expenses of $9,656 were $2,067 higher than the same period in 2015, primarily as a result of higher wages and benefits of $1,900 and selling expenses of $250, partly offset by $200 of lower bad debts. Sub-metering SG&A expenses in the second quarter of 2015 included $184 of costs associated with the acquisition of Triacta, primarily related to professional fees associated with entering into the purchase agreement.

Corporate expenses of $6,959 in the second quarter and $15,515 year to date, increased by $2,780 and $6,028, respectively, compared to the same periods in 2015. The $2,780 increase in the second quarter was primarily as a result of $1,900 in higher wages and benefits, driven by higher stock based compensation costs resulting from an increase in the price of Enercare common shares, and $1,000 of higher office expenses resulting from increased information technology costs. The $6,028 year to date increase was primarily as a result of $3,600 in higher wages and benefits, driven partly by $1,700 of higher stock based compensation costs resulting from an increase in the price of Enercare common shares, and $2,000 of higher office expenses resulting primarily from $1,700 of increased information technology costs.

Corporate SG&A expenses in the second quarter of 2016 included $574 of integration and business transformation costs related to the DE Acquisition, primarily from information technology integration activities to optimize the information technology platforms.

Amortization Expense

Amortization expense increased by $4,752 or 15% to $35,796 in the second quarter of 2016 and by $6,210 or 10% to $68,103 year to date, over the same periods in 2015, primarily due to an increasing capital asset base from asset mix changes in the rentals portfolio, the addition of the Service Experts portfolio and increased sub-metering capital investments, which are amortized over a shorter life than those of the Enercare Home Services business.

Loss on Disposal of Equipment

Enercare reported a net loss on disposal of equipment of $891 in the second quarter of 2016 and $2,822 year to date, a decrease of $681 or 43% and $502 or 15%, respectively, over the same periods in 2015. The net loss on disposal amount is influenced by the number of assets retired, proceeds on disposal of equipment, changes in the retirement asset mix and the age of the assets retired.

Interest Expense

Interest expense payable in cash increased by $1,083 to $7,613 in the second quarter of 2016 and by $1,092 to $14,242 year to date, compared to the same periods in 2015. These increases are primarily related to the increase in the 2016 Term Loan related to the financing of the SE Transaction, partially offset by the conversion of the 6.25% convertible unsecured subordinated debentures of Enercare ("Convertible Debentures") to Enercare common shares.

Notional interest of $210 in the second quarter and $420 year to date in 2016 relate to the defined benefit employee benefits plans. Amortization of financing costs includes the previously unamortized costs associated with the 2012 Notes, 2013 Notes, Convertible Debentures, the 2014 Notes and 2016 Term Loan.

As part of the SE Transaction, SE Subscription Receipts were issued during the first quarter of 2016 and subsequently exchanged for Shares upon the closing of the SE Transaction on May 11, 2016. While the SE Subscription Receipts remained outstanding, they were classified as debt, resulting in an interest expense of $1,109 during the second quarter and $2,217 year to date, which were the equivalent to the dividend payments on such SE Subscription Receipts if they had been Shares. Equity bridge financing fees of $9 during the second quarter and $198 year to date were also incurred as part of the SE Transaction.

Other Income

During the second quarter of 2015, Enercare realized a one-time settlement of $580 from a supplier of sub-metering equipment.

Income Taxes

Enercare reported current tax expenses of $15,259 in the second quarter of 2016 and $27,515 year to date, increases of $12,969 and $22,271, respectively, over the same periods in 2015, primarily as a result of a one year tax deferral recognized in 2015, available through a subsidiary of Enercare Solutions. The deferred income tax recoveries of $7,633 in the second quarter of 2016 and $16,847 year to date, increases of $8,956 and $21,079, respectively, compared to the deferred tax expenses recorded in the same periods in 2015, were primarily as a result of temporary difference reversals in the Enercare Home Services and sub-metering businesses.

Net Earnings

Net earnings were $16,051 in the second quarter of 2016 and $24,246 year to date, a decrease of $153 and an increase of $140, respectively, compared to the same periods in 2015, as previously described.

EBITDA, Adjusted EBITDA and Acquisition Adjusted EBITDA

The following table summarizes comparative quarterly results for the last eight quarters, and reconciles net earnings, an IFRS measure, to EBITDA, Adjusted EBITDA and Acquisition Adjusted EBITDA.

Outlook

The forward-looking statements contained in this section are not historical facts but, rather, reflect Enercare's current expectations regarding future results or events and are based on information currently available to management. Please see the section entitled "Cautionary Note Regarding Forward-Looking Statements" in this news release.

Enercare Home Services Segment

• Our strategy to emphasize HVAC rentals over outright sales in order to create a long-term customer revenue stream and provide valuable cross-selling opportunities continues to be successful. While this strategy has resulted in a significant increase in recurring HVAC rental revenues, we anticipate the short-term impact on non-recurring sales and other services revenue to continue throughout 2016.

• In December 2015, Enercare launched a pilot HVAC financing program, which was planned to be rolled out in phases within the operating territory during 2016. As this pilot program ran longer than anticipated, Enercare has revised the timing of its phased roll out to be completed in 2017.

Sub-metering Segment

• Approximately one-half of new contracted units in the first half of 2016 were generated from thermal and water meters and we anticipate this to continue. This trend should also contribute to lower billing costs over time as multiple products are billed on a single bill.

• Our sub-metering sales opportunities continue to be strong and skewed towards multi-commodity products within the new construction and condominium segments. Approximately three-quarters of the newly contracted services over the past two quarters have come from new construction condominiums. Although the buildings related to these contracts have yet to be constructed and as a result the bulk of the capital and all of the related revenues will occur in 24 to 36 months, once constructed all units within these buildings will start billing on initial move-in. This is in contrast to retrofit apartment contracts for which billing starts sooner but penetration lags as it is reliant on turnover.

Service Experts Segment

• The Service Experts Transaction is expected to be 25% accretive to Normalized Pro Forma Distributable Cash per Share in 2016.

• Cost synergies relating to the SE Transaction are estimated to be in the range of $0.05 to $0.08 per Share on an annualized basis by the end of 2017, primarily as a result of a reduction in sourcing costs.

• Our priority for the first 12-months will continue to be to focus on successfully integrating the Service Experts operations both in the United States and Canada. In addition, Enercare intends to introduce a rental program for Service Experts within Canada during the fall of 2016 and extend this program into select states in the United States in the first half of 2017.

• The business of Service Experts is subject to greater seasonality than Enercare Home Services as a result of fewer recurring revenue sources. Revenue and profits tend to be seasonally highest in the second quarter of the year, followed by the third quarter, due primarily to the geography where Service Experts operates and weather patterns. The heating season (roughly November through February) and cooling season (roughly May through August) are periods when consumers transition their buying patterns from one season to the next. In most of the states that Services Experts operates, cooling equipment as opposed to heating equipment represents a substantial portion of its annual HVAC sales and service revenue. Conversely, in the 3 provinces that Service Experts operates, heating equipment represents a large portion of its Canadian sales and service revenue. The sales are also impacted by seasonal weather patterns; in periods of extreme heat and cold, installation and demand service revenue tend to increase. These seasonal influences, along with the location of operations, affect the mix and volume which can drive sales and related segment profit. This results in somewhat higher sales in the second and third quarters due to the higher volume in the cooling season relative to the heating season and the lowest revenue and substantially reduced profit, relative to other quarters, in the first quarter. As a result, the working capital needs are generally greater in the first quarter, followed by higher operating cash inflows in the second and third quarters.

2016 Income Taxes

• Current 2016 Canadian income taxes are expected to be in the range of $46 million to $53 million.

• The SE Transaction was structured to permit Enercare to "step up" the tax basis of Service Experts' assets in the United States through a "338 election" under US tax rules. Enercare estimates the resulting tax shelter value to be approximately US$65 million on a net present value basis. This tax shelter is estimated to result in a reduction of US taxable income of approximately $24 million to $28 million per year for the next 15 years.

• Enercare is assessing corporate expenses expected to be incurred in Canada to manage and benefit the US operations of Service Experts which Enercare estimates will result in a favourable expense reimbursement of between $2 million and $5 million per year.

2016 Capital Investments

• Enercare is targeting a range of between $111 million and $157 million in capital investments in 2016, excluding Service Experts. Management targets an Internal Rate of Return from capital investments in its core businesses of between 15% and 20%.

Financial Statements and Management's Discussion and Analysis

Enercare's financial statements and management's discussion and analysis for the quarter ended June 30, 2016 are available on SEDAR at www.sedar.com or on Enercare's investor relations website at www.enercareinc.com.

Conference Call and Webcast

Management will host a conference call and live audio webcast to discuss Enercare's financial results for the second quarter ended June 30, 2016 this morning at 10:00 a.m. John Macdonald, President and CEO and Evelyn Sutherland, CFO, will review Enercare's results and discuss the quarter's operating highlights. Details of the call and webcast are as follows:

Those wishing to listen to the teleconference may access the live webcast as follows:

Cautionary Note Regarding Forward-Looking Statements

This news release contains certain forward-looking statements within the meaning of applicable Canadian securities laws ("forward-looking statements" or "forward-looking information") that involve various risks and uncertainties and should be read in conjunction with Enercare's 2015 audited consolidated financial statements. Additional information in respect of Enercare, including the Annual Information Form of Enercare dated March 21, 2016 ("AIF"), can be found on SEDAR at www.sedar.com.

Statements other than statements of historical fact contained in this news release may be forward-looking statements, including, without limitation, management's expectations, intentions and beliefs concerning anticipated future events, results, circumstances, economic performance or expectations with respect to Enercare, including Enercare's business operations, business strategy and financial condition. When used herein, the words "anticipates", "believes", "budgets", "could", "estimates", "expects", "forecasts", "goal", "intends", "may", "might", "outlook", "plans", "projects", "schedule", "should", "strive", "target", "will", "would" and similar expressions are often intended to identify forward-looking information, although not all forward-looking information contains these identifying words. These forward-looking statements may reflect the internal projections, expectations, future growth, results of operations, performance, business prospects and opportunities of Enercare and are based on information currently available to Enercare and/or assumptions that Enercare believes are reasonable. Many factors could cause actual results to differ materially from the results and developments discussed in the forward-looking information.

In developing these forward-looking statements, certain material assumptions were made. These forward-looking statements are also subject to certain risks. These factors include, but are not limited to:

• actual future market conditions being different than anticipated by management;

• the failure to realize the anticipated benefits of the SE Transaction, strategic initiatives and tax efficiencies; and

• the risks and uncertainties described under "Risk Factors" in the AIF.

Material factors or assumptions that were applied to drawing a conclusion or making an estimate set out in forward-looking statements, including pro forma financial information, include:

• the view of management regarding current and anticipated market conditions;

• industry trends remaining unchanged;

• the financial and operating attributes of Enercare and Service Experts as at the date hereof and the anticipated future performance of Enercare and Service Experts;

• assumptions regarding the volume and mix of business activities remaining consistent with current trends;

• assumptions regarding the interest rates of the 2014 Term Loan and 2016 Term Loan, foreign exchange rates and commodity prices;

• the extent to which the SE Transaction is accretive, which may be impacted by the realization and timing of synergies and the operating performance of Enercare and Service Experts;

• assumptions regarding non-recurring transaction costs estimated to be incurred by Enercare in connection with the SE Transaction;

• assumptions regarding future selling, general and administration costs estimated to be incurred by Enercare, including in connection with the running of the SE Transaction; and

• the number of common shares outstanding remaining constant.

There can be no assurance that the anticipated strategic benefits and operational, competitive and cost synergies from the SE Transaction will be realized.

Readers are cautioned that the preceding list of material factors or assumptions is not exhaustive. Although forward-looking statements contained in this news release are based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. Accordingly, readers should not place undue reliance on such forward-looking statements and assumptions as management cannot provide assurance that actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, Enercare. All forward-looking information in this news release is made as of the date of this news release. These forward-looking statements are subject to change as a result of new information, future events or other circumstances, in which case they will only be updated by Enercare where required by law.

About Enercare

Enercare is headquartered in Toronto, Ontario, Canada and is publicly traded on the Toronto Stock Exchange (ECI.TO). As one of North America's largest home and commercial services and energy solutions companies with approximately 3,800 employees under its Enercare and Service Experts brands, Enercare is a leading provider of water heaters, water treatment, furnaces, air conditioners and other HVAC rental products, plumbing services, protection plans and related services. With operations in Canada and the United States, Enercare serves approximately 1.6 million customers annually. Enercare is also the largest non-utility sub-meter provider, with electricity, water, thermal and gas metering contracts for condominium and apartment suites in Canada and through its Triacta brand, a premier designer and manufacturer of advanced sub-meters and sub-metering solutions.

For more information on Enercare visit enercare.ca. Additional information regarding Enercare is available on SEDAR at www.sedar.com.

Source: Enercare Inc.